Direct selling: the trust business

Enter the world of direct selling where individuals purchase products from large companies and sell them directly to customers. This business model cuts out the middleman and retail stores. There are two main approaches: single-level marketing, where sellers earn from their own sales, and multi-level marketing, where sellers profit from their sales and by recruiting new sellers. Unlike pyramid schemes, direct selling requires minimal upfront investment and combines entrepreneurship with personal relationships, offering a unique alternative to traditional retail.

Fulfilling orders for direct selling companies presents unique challenges. Joakim Garint, Sales Director at Radial Europe, offers valuable insights into navigating these complexities and effectively supporting direct selling customers.

How would you briefly characterize direct selling?

The most important product or service that all direct selling companies offer is trust. In this business, you buy from a real person, often a friend, not from a webpage. That’s where trust comes in. If the independent sales force can trust their company to provide reliable service, they will thrive. At Radial, we are very much in the trust business. We must deliver on our clients’ promises. Every package and box that leaves Radial must be 100% accurate.

What trend stands out in the industry at the moment?

The focus in direct selling is increasingly shifting towards the end consumer. Order velocity is becoming more intense, and the requirements for packing and overall customer experience are growing more important. Many direct selling companies are competing for the same market share, making it crucial to stand out.

Is fulfilling orders for direct selling companies different from fulfilling orders for retail?

In fulfillment, it’s very important to have a partner who understands your business. Direct selling is more complex than a regular business. Fulfillment for these customers is not just about picking and packing a product into a box and shipping it away. The success factor lies in understanding our direct selling clients’ business model, where managing demands from multiple stakeholders and year-round campaigns constantly affecting sales cycles is key.

How well does Radial know this business?

We have worked with over 30 different direct selling companies, ranging from semi-large to very large international businesses. These clients span various sectors, including beauty, food, supplements, and home fragrance. We know the business, its obstacles, challenges and possibilities and can respond to its specific needs.

We are also members of national DSA organizations, allowing us to follow and support these issues, aiding both our progress and our clients’ upcoming demands.

What is unique about Radial is that we sit on the same side of the table with our clients, working together and finding solutions to the challenges they approach.

Tell us more about these challenges and how Radial supports its clients to overcome them.

One big challenge is the uncertainty about volume forecasting, due to the need for agility within direct selling companies. Volumes can go 500% up from one day to another. To cope with volumes going up and down, you need a flexible team and a flexible solution. We use both automatic and manual solutions to fill the gap between the forecast and the actual number of orders being delivered.

There will be a new challenge on how fast companies can deliver. We have fulfillment centers that are close to our clients, and we plan new ones. This means Radial will expand into countries where we are not currently present, to follow and support our clients. As our customers constantly enter new markets, we also need to expand to keep the last mile delivery short, or even shorten it further.

Where do these fluctuations in volume come from?

Direct selling companies are very promotional and marketing intense. The specific thing is that multiple campaigns go on there at the same time. In an e-commerce business, you may have one or two campaigns going on for a certain product or for a certain discount. In the direct selling, you have long term campaigns, mid-term and some very-short term. This can be sales campaigns regarding sponsorship, leadership development, incentive trips, etc. That, of course, sets a little bit of a challenge on the fulfillment and operation. So, as a direct selling company, you need a partner with deep insights into this way of doing business.

What else is unique about fulfilling orders for direct selling companies?

The number of people who are aware of the failure of order is much higher here. In a regular ecommerce business, only you know if the package is not complete or isn’t looking good. Maybe you will tell your closest friend about it. That is all. In the direct selling it might be 100 people knowing about it: the person receiving the package, the team this person belongs to, and maybe the whole region this person works in. The trust of delivering 100% each time is very important.

How would you describe the services Radial offers to direct selling companies?

With our experience and strong focus on quality, we ensure outstanding accuracy according to our clients’ requirements. In picking and packing, the end customer will receive the right quantity and the correct items in an attractive package, delivered by the appropriate last-mile transportation.

We are innovating and automating the picking process at many of our sites. However, when it comes to packaging and ensuring the package looks appealing to the end consumer, we rely on manual work. Our clients’ products are always delivered with absolute care for quality.

Direct selling companies are looking for a personalized shopping experience, and we provide that. We make the shopping experience memorable. We add value by personalizing wrapping, personalizing gifts or letters, special service with inserts, kitting, bundling and so on.

Do companies use more than one of Radial’s sites?

Many of our clients use multiple sites of Radial. Our sites are seamlessly connected, so you can have cross-border shipments done by EU and US or EU and UK. We achieve this through IT integration. You can have a high-volume operation with a very modern fully automated solution on one site and then complete it with smaller sites and manual operation. You, as the client, express your needs, and we find the solution. Tailor-made for you every time.

I will give you an example. We began fulfilling orders for one client locally and then expanded services across Europe as their business grew. We have supported them in finding transportation solutions, shortening lead times, and cutting costs. Now, we’re further expanding our services for this client with multiple fulfillment sites and last-mile transportation. We’re growing together in new countries and adding more services for them to stay competitive.

Radial is driven by sustainability. Is this important to direct selling companies?

Sustainability is a top priority for many direct selling companies, especially those in the health and beauty sector. These companies often sell organic products, items containing natural oils and fragrances, and products packaged in glass containers. Radial provides certification on how to handle and operate these products to ensure they remain organic and retain their qualities. This helps us maintain a sustainable supply chain. We support our customers by promoting sustainable practices, from operating in eco-friendly facilities to ensuring last-mile deliveries are done sustainably.